IRS Form 1099

IRS Form 1099 is a form generated by the Internal Revenue Service to be used when filing taxes. Any contractor who is paid at least $600 while working for a company as an independent contractor must be given a 1099.

The 1099 form is used to prepare and file what is termed an information return, while the return normally generated by a W-2 is called a tax return. While a W-2 covers the wages, salaries and tips that a person makes at their job or jobs during the course of a year, the 1099 covers all the potential other ways that an individual may make money that should be held as taxable income.

1099 forms must be furnished to the individual taxpayer no later than February 1 of the year after the fiscal year ends. Therefore, if a person earned enough money in 2009 to warrant the distribution of a 1099, it must be sent by February 1, 2010. If boxes eight or fourteen of the form are selected, the deadline is extended to February 15.http://www.irs.gov/pub/irs-pdf/f1099msc.pdf

There are several variations of the 1099, all applying to different specific situations or transactions that a person may encounter over the course of a given year.

These include the 1099-A, which deals with the abandonment or acquisition of secured property. If your home was foreclosed on, a 1099-A will be sent and used as it is still seen as a sale of property. If there were multiple lenders involved in the transaction, an individual would get a 1099-A from each lender.

Form 1099-B details proceeds from Broker and Barter transactions. This form generally deals with the proceeds gained from selling or trading stock shares. It has all the pertinent information regarding number of shares, the date of the transactions, along with the money involved and the amount of federal tax withheld.

1099-C has to deal with the cancellation of debt. If a creditor waives your obligation to pay back the money you owe, a 1099-C is furnished. However, an individual then has to treat that waived debt as income on their tax return.

Other commonly used versions of the 1099 include the 1099-DIV, which deals specifically with dividends and capital gains distributions paid out by a fund, 1099-MISC, which is given to independent contractors and is deemed for miscellaneous income, and the 1099-R, for distributions from pensions and retirement funds.http://www.irs.gov/pub/irs-pdf/f1099r.pdfhttp://www.irs.gov/pub/irs-pdf/p1220.pdfhttp://www.irs.gov/pub/irs-pdf/f1099msc.pdf